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Annual report for fiscal 2018–2019
Message from the chair
Ontario's agri-food sector is the cornerstone of our province's success, with almost 80% of our farm gate value attributed to the province's regulated marketing sector.
Continuous changes in consumer demands, global markets, trade, the environment, labour and business have created new issues and obstacles; however, where there are issues, there are also opportunities.
The Ontario Farm Products Marketing Commission's (Commission) key priorities are to ensure that Ontario's marketing boards and Section 12 representative associations are performing effectively, that we are helping foster stakeholder collaboration to achieve sector solutions, and that we are doing everything that we can to help advance Ontario's interests in regulated marketing provincially, nationally and globally.
As Commission chair, I have the opportunity to meet with our boards to hear about their successes, opportunities and challenges. To be successful in today's global environment, you need to focus on industry partnerships, collaboration and innovation.
I have seen firsthand the benefits of strengthened partnerships and collaboration across the value chain and how these relationships have supported the great work being done by our boards to benefit all industry participants.
Whether through ongoing leadership, improvement to the regulatory framework, or our strong relationships with industry, the Commission strives to build Ontario's regulated marketing sector for the future.
In 2018–19 the Commission welcomed David Hagarty, the new director and secretary to the Commission and Cameron McWilliam as a new Commission member.
2018–19 was a very busy time, and I am proud of the Commission's accomplishments. I am also aware that more work can and needs to be done. The Commission and the staff within the Secretariat, are committed to providing the ongoing leadership and support needed to ensure that Ontario's regulated marketing sector remains dynamic and competitive.
Jim Clark
Chair, Ontario Farm Products Marketing Commission
Role of the Commission
The Ontario Farm Products Marketing Commission (Commission) is a regulatory agency, without a governing board, established under the authority of the Ministry of Agriculture, Food and Rural Affairs Act.
It is directly accountable to the Minister of Agriculture, Food and Rural Affairs (OMAFRA) for its performance in fulfilling its mandate and its compliance with government policies and directives. The minister, in turn, is accountable to Cabinet and the Legislature for the Commission's fulfillment of its mandate and for reporting on the Commission's affairs.
The Commission provides oversight and leadership to the province's 22 marketing boards and three Section 12 representative associations established under the Farm Products Marketing Act (FPMA) and the Milk Act (MA). A list of the boards and associations can be found in Appendix I.
Vision
Dynamic, competitive agri-food sectors.
Mission
Lead, supervise and direct Ontario's regulated marketing system to effectively adapt to change.
Mandate
Advance an effective and accountable regulated marketing system that creates investment confidence and promotes economic growth in Ontario's agriculture and agri-food industries.
Strategic objectives
- Oversee and facilitate marketing board and representative association effectiveness and accountability.
- Foster enhanced stakeholder collaboration to achieve whole sector solutions.
- Advocate for Ontario's interests in regulated marketing nationally.
Strategy
- Administer the FPMA and MA, and the associated legislative and regulatory framework for the regulated marketing system in Ontario.
- Develop and implement regulated marketing policy in collaboration with OMAFRA.
- Oversee marketing boards to ensure that they operate within the powers and authorities delegated to them.
- Provide leadership in the form of advice, facilitation, direction and education to Ontario's marketing boards and section 12 representative associations.
Commission team
The Commission is comprised of a chair, vice chair and four members, all appointed by the Lieutenant Governor in Council.
The diverse membership is made up of producers and processors with a variety of business, industry and commodity experience.
2018–2019 members
Jim Clark, chair
First appointed to the position: June 16, 2017
Appointment expiry: December 13, 2019
Valerie Gilvesy, vice chair
First appointed to the position: August 17, 2017
Appointment expiry: August 16, 2019
Bette Jean Crews, member
First appointed to the position: April 18, 2012
Appointment expiry: April 17, 2022
Valerie Hobbs, member
First appointed to the position: December 17, 2013
Appointment expired: December 16, 2018
Robert Anderson, member
First appointed to the position: May 13, 2015
Appointment expiry: May 12, 2020
Dan Cohoe, member
First appointed to the position: May 27, 2015
Appointment expiry: May 26, 2020
Cameron McWilliam, member
Appointed to the position: December 31, 2018
Appointment expiry: December 30, 2020
The Commission is also supported by Secretariat staff who provide Commission members with information, administrative support, and policy analysis and advice on issues impacting each commodity.
2018–19 accomplishments
Open for Business
Open for Business is a key priority for Ontario's government, with the objective to remove overly prescriptive requirements for businesses, reduce government duplication and overlap, provide clarity to the public, reduce administrative burdens and improve efficiency in order to lower business operating costs and improve Ontario's competitiveness.
In November 2018, the Commission posted proposed amendments on the regulatory registry under the MA to eliminate costly and prescriptive requirements for dairy processors, as well as small food service and retail operators, while maintaining food safety standards. The Commission and OMAFRA consulted with key stakeholders, including the Dairy Farmers of Ontario (representing cow dairy producers) and the Ontario Dairy Council (representing processors), prior to finalizing the amendments and will continue to work with these organizations to identify future Open for Business opportunities.
Oversee and facilitate marketing board and representative association effectiveness and accountability
The Commission works closely with marketing boards and Section 12 representative associations to ensure that they are performing effectively. This includes monitoring their financial stability, helping them develop and maintain relationships along the value chain, ensuring they adhere to governance best practices, providing guidance during strategic planning and keeping track of marketing system adjustments.
Providing leadership and assessing board performance
The Commission strives to maintain open and transparent relationships with its boards to ensure that they feel supported and that they operate within the authorities delegated to them.
Working closely with board and association chairs and staff provides the Commission with an opportunity to foster an environment of open communication, where boards can feel comfortable reaching out to the Commission for guidance and support in managing industry issues.
Marketing boards and representative associations appear before the Commission at regular intervals for formal reviews in order to report on their activities and strategies. In 2018–19, eleven marketing boards/representative associations appeared before the Commission.
The Commission is working to continuously enhance its oversight and monitoring of board practices. Secretariat staff assess each board annually, which includes a review of:
- governance practices
- finances
- succession planning
- a market overview
- analysis of the sector
- value to their members
- opportunities for sector growth
- industry relations
- key board activities such as research, promotion and marketing
The information gathered is used to advise boards on areas of improvement.
The Commission is currently working on developing a more rigorous and standardized board review process and will have it in place early 2019–20.
Ensuring sound financial management
Secretariat staff assess each board's and Section 12 representative association's financial statements to ensure that they are financially sound and sustainable, and that they have sufficient financial reserves to address potential sector issues.
Long-term planning
All boards are expected to have a long-term strategic plan in place outlining their future direction and succession planning.
Annual board governance training
The Commission delivers an annual governance training session designed for new board directors and senior staff.
Eighty-nine per cent of the participants who attended the Commission's April 2018 training session stated that the information provided was informative, comprehensive and met their needs.
Processing vegetable sector
The processing vegetable sector has experienced some challenges over the past few years with deteriorating relationships between the Ontario Processing Vegetable Growers (OPVG) and vegetable processors.
In October 2018, OPVG transitioned to a fully elected board. The minister asked the Commission to provide OPVG with an advisor to support the board during this transition period. Jason Lietaer of Enterprise Inc. reviewed OPVG's governance and operations processes and provided advice on how to best move forward.
In January 2019, OPVG's Commission-appointed chair, Suzanne van Bommel, resigned from her position and Dave Hope was appointed in her place. Ms. van Bommel was then retained by the Commission to provide advice to both the Commission and OMAFRA, primarily focused on board governance and developing opportunities for growth across Ontario's regulated marketing sector.
While 2019 processing vegetable negotiations were completed, the process proved to be difficult. In response to the challenges, OMAFRA's minister directed the Commission to develop a new processing vegetable marketing approach that includes direct contracting between processors and tomato growers, and to consider alternative marketing approaches for other processing vegetables. The minister indicated that a new approach is needed to promote processing investment, enable growers to be profitable, and result in a sector that is competitive and sustainable in the future.
A proposal was posted on the regulatory registry on April 18, 2019, in alignment with the minister's request. The proposal also included amendments that would enable an open, fair and transparent board member election process for OPVG through modern governance and election techniques.
Promoting and supporting good governance
The Commission is currently exploring ways to help marketing boards provide enhanced governance, accountability and transparency in regulated marketing on behalf of their members.
Regulations that support the needs of boards today and tomorrow
The Commission has extensive authority to establish, amend or revoke regulations under the FPMA and MA to help support producers, processors, consumers and Ontario's agri-food sector as a whole. As part of this authority, the Commission also monitors boards to ensure that they are adhering to the authorities delegated to them.
By means of regulation, the Commission delegates certain authorities to the boards related to regulated marketing. These authorities vary considerably among boards and may include powers to:
- promote their commodity
- provide marketing information to their producer-members
- directly fund production and market research, or co-ordinate it from other sources
- participate on industry advisory committees
- negotiate the minimum price that will be paid to producers and/or other terms and conditions of sale
- set the price that will be paid to producers of a specific commodity
- determine how much each farmer can produce and/or market through production quotas
By working closely with boards, the Commission has the ability to create and amend regulations so that they remain relevant for the industry in today's global economy.
2018–19 amended regulations
The Commission supports a regulatory environment that provides for the needs of the boards as well as the needs and interests of the value chain.
Posting proposed regulation amendments on Ontario's regulatory registry for public comment allows the Commission to gather feedback and input from those most affected by the regulations. All comments received are considered before any final amendments are made.
Under the Farm Products Marketing Act
Ontario Regulation 125/14 Apples — Marketing
Adjustments were made to the timelines for the negotiation of annual agreements between the Ontario Apple Growers and juice apple processors. The amendments came into force on May 2, 2018.
Ontario Regulation 428 Seed Corn — Plan
Amendments were made to include the amalgamation of Districts 1 and 2, to increase board member term limits from two to three years, and to introduce a new consecutive term limit of four terms, followed by a mandatory one-year period of ineligibility for board election. The amendments came into force on November 29, 2018.
Ontario Regulation 440 Vegetables for Processing — Marketing
Amendments extended the 2019 negotiation deadlines for tomatoes and sweet corn by 14 calendar days. The amendments came into force on May 1, 2019.
Under the Milk Act
Ontario Regulation 761 — Milk and Milk Products
On November 19, 2018, proposed amendments were posted on the regulatory registry to help reduce burden for existing dairy processors, new and expanding dairy processors, and small foodservice and retail operations. The Commission and OMAFRA continue to consult with stakeholders on the proposed amendments to ensure that stakeholder concerns are carefully considered. Regulation 761 has not been amended as of this fiscal year-end.
Negotiated agreements
Each year, the Commission is required to bring agreements or arbitrated awards under the FPMA into force.
In 2018–19, 50 negotiated agreements were brought into force for processing vegetables, chicken, processing grapes, potatoes, soybeans, apples and a three-year agreement for tomato seedlings.
All agreements were brought into force by the Commission within three months of receipt of the signed agreements. In 2018–19, all negotiating agencies were able to reach agreement without the need to resort to arbitration.
Processor licences
Under the FPMA, the Commission has the authority to issue licences to processors of grapes for processing, asparagus, potatoes, tender fruit and vegetables for processing, as well as dealers of seed corn.
All processor and dealer licences were considered by the Commission within three months of receiving a completed application.
In 2018–19, the Commission issued 54 processor licences.
Commodity | Licences issued or reissued during the 12 months ending March 31, 2019 | Licences issued or reissued during the 12 months ending March 31, 2018 | Total licences as of March 31, 2019 |
---|---|---|---|
Asparagus | 2 | 1 | 2 |
Grapes | 42 | 41 | 283 |
Potatoes | 3 | 5 | 22 |
Tender fruit | 6 | 5 | 50 |
Processing vegetables | 1 | 3 | 16 |
Seed corn | 0 | 0 | 6 |
Total | 54 | 55 | 379 |
Foster enhanced stakeholder collaboration to achieve whole sector solutions
By providing stakeholders with opportunities to work together and provide their input, the Commission is helping improve communication, collaboration and relationships along the value chain, including relationships between producers, processors, retailers, and government.
The Commission encourages boards and stakeholders to work collaboratively in an open and transparent fashion to achieve sector solutions.
Stakeholder consultations
The Commission strongly encourages its boards and associations to work closely with their grower members and stakeholders to determine support for various initiatives.
The feedback that the Commission receives through stakeholder consultations, regulatory registry postings, correspondence and expression of opinion votes, provides invaluable industry perspectives.
The Commission held five external stakeholder consultation sessions related to the proposed Regulation 761 amendments under the MA.
Industry advisory committees
Through Industry Advisory Committee (IAC) meetings, stakeholders are encouraged to speak freely about the issues that they are facing to enhance communication along the value chain and maximize market opportunities. This collaborative approach often results in industry led solutions.
In 2018-19, the Commission chaired 16 IAC meetings, which included a meeting of the interim Broiler Hatching Egg and Chick Industry Advisory Committee, currently in place until a formal IAC can be established in regulation.
The Fresh Asparagus Advisory Committee membership was expanded to include retailers and consumer representatives and the Berry Industry Advisory Committee was expanded to include marketing and wholesale representatives. Expanding IAC memberships brings additional perspectives to the needs of those sectors.
Industry engagement
Regular engagement between the Commission and Ontario's marketing boards and representative associations ensures that Commission members and staff are aware of issues impacting these industries. It also allows the Commission to build stronger relationships, trust and collaboration across the value chain.
In 2018–19, seven presentations were provided to the Commission by various stakeholder groups on issues and opportunities impacting their sectors.
Commission members and/or staff attend all marketing board and representative association annual general meetings, as well as various conferences, farm shows, district meetings, and board meetings to ensure that the Commission is informed of the successes and challenges facing today's agri-food sector.
Advocate for Ontario's interests in regulated marketing nationally
The Commission's goal is to support a regulated marketing system that promotes and meets the needs of Ontario's entire agri-food sector, its growers, processors and consumers.
Supporting Ontario's growth initiatives
The Commission works with the supply managed sectors to develop strategies to maintain and increase Ontario's share of the national allocation.
During formal board reviews, the Commission asked boards to provide updates on their growth initiatives and strategies and to provide them with advice on how to pursue potential opportunities to increase production over time.
As a result of the 2014 Differential Growth Agreement, Ontario's share of the national allocation of chicken continued to grow in 2018–19. The national allocation of the remaining supply managed commodities was maintained.
Promoting Ontario's interests nationally
As a signatory to federal, provincial and territorial agreements on supply managed commodities, the Commission strives to support national systems that are responsive to changing business and demographic needs, while continuing to serve Ontario's economic interests.
The Commission works closely with its stakeholders and OMAFRA, to stay aware of national and international trade issues impacting supply managed commodities.
In 2018–19, Commission representatives attended five national commodity meetings in support of Ontario's supply managed commodities.
Supply managed boards were encouraged to support a value chain approach, to provide a united voice and position during national discussions.
The Commission also encouraged the non-supply managed boards with national organizations to focus on developing a stronger presence at their national tables to ensure value for money at the national level.
Financial performance
The Commission's resource requirements (staffing and financials) are absorbed by OMAFRA and are incorporated into the ministry's business plans and financial statements which are subjected to review by the Auditor General of Ontario.
During the 2018–19 fiscal period, OMAFRA allocated $600,000 for the Commission's direct operating expenditures. This amount included funds for an advisor related to the processing vegetable sector, an anticipated mediation process, and anticipated increased number of Commission meetings, industry advisory committee meetings and out of province travel. At fiscal year end, the Commission's operating expenditures were $268,146 under its allocated budget. The decreased spending is a result of the cancelation of the mediation process and a government-wide spending freeze on expenses.
2018–2019 direct operating expendituresfootnote 1
Commission direct operating expenditures | 2017–18 ministry expenditures | 2018–19 ministry allocation | Actual expenditures to March 31, 2019 | Variances between allocation and expenditures |
---|---|---|---|---|
Transportation and communications | $73,073 | $90,000 | $48,527 | -$41,473 |
Services | $450,989 | $485,000 | $274,142 | -$210,858 |
Supplies and equipment | $25,340 | $25,000 | $9,185 | -$15,815 |
Total | $547,845 | $600,000 | $331,854 | -$268,146 |
Agency accountability
As the Commission is a provincial agency under OMAFRA, it must comply with the Agencies and Appointments Directive. 2018–19 agency accountability performance targets and results are detailed in Appendix III.
I approve and submit this 2018–2019 Annual report for the Ontario Farm Products Marketing Commission.
Original signed by: Jim Clark, Chair of the Ontario Farm Products Marketing Commission
Appendix I: boards and associations as of March 31, 2019
Marketing boards
The Milk Act provides authority to one marketing board that regulates milk and cream.
- Dairy Farmers of Ontario
The Farm Products Marketing Act governs Ontario's remaining twenty-one marketing boards as well as 3 representative associations designated under Section 12 of the act.
- Asparagus Farmers of Ontario
- Berry Growers of Ontario
- Chicken Farmers of Ontario
- Egg Farmers of Ontario
- Grain Farmers of Ontario
- Grape Growers of Ontario
- Ontario Apple Growers
- Ontario Bean Growers
- Ontario Broiler Hatching Egg and Chick Commission
- Ontario Flue-Cured Tobacco Growers' Marketing Board
- Ontario Fresh Grape Growers' Marketing Board
- Ontario Greenhouse Vegetable Growers
- Ontario Pork Producers' Marketing Board (Ontario Pork)
- Ontario Potato Board
- Ontario Processing Vegetable Growers
- Ontario Sheep Marketing Agency (Sheep Farmers of Ontario)
- Ontario Tender Fruit Growers
- Ontario Tomato Seedling Growers' Marketing Board
- Seed Corn Growers of Ontario
- Turkey Farmers of Ontario
- Veal Farmers of Ontario
Section 12 representative associations
- Flowers Canada (Ontario) Inc.
- Ontario Canola Growers' Association
- Ontario Ginseng Growers' Association
Appendix II: 2018-2019 strategic objectives: performance measures
1. Ensure the effective performance of marketing boards
Strategies | Implementation | Measure of success/performance target | Results |
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Provide leadership to regulated marketing in Ontario |
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Monitor effectiveness of boards and assess their performance |
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Ensure boards demonstrate sound financial management |
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Encourage boards to engage in long term planning |
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Creation of a regulatory environment that supports the needs of the regulated boards |
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Provide training to boards and section 12 representative associations |
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Commission is knowledgeable about regulated marketing and factors influencing the system |
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2. Foster enhanced stakeholder collaboration to achieve sector solutions
Strategies | Actions/implementation | Measure of success/performance target | Results |
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Provide leadership to facilitate stakeholder collaboration |
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Consultation with stakeholders |
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Increase inter-board networking and relationship building |
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Engagement with industry |
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Encourage industry to be proactive in developing sector solutions |
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3. Advance Ontario's interests in regulated marketing
Strategies | Actions/implementation | Measure of success/performance target | Results |
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Support Ontario's growth initiatives |
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Promote Ontario's interests at the national level |
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Assist in the creation of marketing boards and/or Section 12 designations |
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Consider consumer interests |
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Appendix III: 2018–2019 agency accountability performance targets
The Commission is a non-board governed provincial agency under the Agencies and Appointments Directive (AAD). The chart below identifies the annual compliance requirements under the AAD, as well as the Commission's increased collaboration initiative with OMAFRA.
Goal | Actions and implementation | Measure of success and performance target | Results |
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Compliance with the AAD |
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Increase collaboration with ministry |
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Client service |
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Footnotes
- footnote[1] Back to paragraph Changes in reporting: the Commission's resource requirements (staffing and financials) which are absorbed by OMAFRA, have been excluded.